Tax ID Theft – a massive problem, especially in Florida

Identity theft of the deceased is a problem which we have written about before. It’s one that can be prevented by taking some simple steps. However, the U.S. Treasury Department recently announced a new, lucrative reason to steal and use the identity of a deceased person – tax identity fraud.

How does this work? Using stolen names and Social Security numbers, thieves are filing phony electronic tax forms to claim refunds. According the U.S. treasury department, this is a huge problem that could cost our country $21 billion over the next five years. The number of cases nationwide has skyrocketed from 48,000 in 2008 to more than 1.2 million in 2012.

It is a very troubling problem since, unlike Medicare fraud, it is associated with violent crime and armed gangs. All a gang needs is your name and tax ID number. They can make up the other details needed to complete a tax form.

To prevent this from happening, the IRS is trying to speed up the loading of data from W-2 payroll forms issued at the beginning of the tax season, a time lapse which gives thieves time to file using false data.

They are also looking for ways to authenticate the identity of tax files at the time of filing and are working with the Social Security Administration to limit access to a registry of Social Security data of deceased tax payers, the Death Master File. This File is often a target of fraud since Social Security numbers currently become public record 90 days after someone dies.

To learn more about identity theft of the deceased and find out how you can prevent the identify of a loved one from being stolen, go to http://diesmart.com.